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Ford to stop manufacturing cars in India next year; EcoSport crossover will cease production

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NEW DELHI — Ford Motor Co. said it will stop manufacturing cars in India and will shut down its plants in the country, becoming the latest automaker to quit a market still dominated by Asian rivals.

The automaker on Thursday said it will close the Sanand assembly plant by the end of this year and will cease production at the Chennai engine and assembly plants by the end of June 2022. The company said the decision followed more than $2 billion in operating losses in India over the last 10 years along with a an asset write-down of $800 million in 2019.

About 4,000 employees will be affected by the restructuring, Ford said.

“Ford will work closely with employees, unions, dealers and suppliers to care for those directly impacted,” the company said in a statement.

The restructuring is expected to trigger pretax special charges of about $2 billion, Ford said, including about $600 million in 2021, about $1.2 billion in 2022 and the balance in later years.

Ford said about $300 million of the $2 billion will be noncash charges, including accelerated depreciation and amortization.

In a related development, Ford also said the EcoSport compact crossover will be discontinued in North America once the India production ceases next year.

“With Ford India’s restructuring announcement, the Ford EcoSport will now be sold in North America only through the second half of 2022,” the company said in an e-mailed statement. “After that, we will continue to serve EcoSport customers with parts, service and warranty support.”

Ford said it will continue to maintain a considerable presence in India.

“India will remain home to Ford’s second-largest salaried workforce globally,” the statement said. “In addition to Ford Business Solutions, Ford India will continue engine manufacturing for export, as well as full customer support operations with service, aftermarket parts and warranty support.”

Ford is the latest vehicle maker to cease production in India, following U.S. companies such as General Motors and Harley Davidson, which have already left a market that had once promised exponential growth.

Ford has struggled to win over India’s frugal buyers and turn a profit in a market dominated by mainly low-cost cars made by Suzuki Motor Corp. and Hyundai Motor Co.

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